Petaluma, Calif. –The U.S. Department of the Army is being sued by the American Small Business League (ASBL) for refusing to release subcontracting reports on contracts awarded to multinational defense giant Bechtel. (https://www.asbl.com/documents/Complaint_SBA_FOIA_ArmyBechtel.pdf)  

The ASBL filed suit in United States District Court, Northern District of California on Tuesday, March 1. The case was filed after the Army repeatedly refused to respond to a Freedom of Information Act (FOIA) request for Individual Subcontracting Reports (ISR) and Summary Subcontracting Reports (SSR) on a prime contract awarded to Bechtel.

The ASBL believes the information contained in the reports may show that Bechtel and the Army cooperated in an effort to circumvent federal law, which requires 23 percent of all federal contracts to be awarded to small businesses. The ASBL is gathering information on several major government prime contractors in preparation for litigation that may include cases filed under the False Claims Act, and Section 16(d) of the Small Business Act.
In 1992, the 9th Circuit Court of Appeals ruled that subcontracting reports are releasable to the public, and do not contain trade secret or proprietary information.

The ASBL has won a series of lawsuits against the federal government under FOIA. Some of the information obtained by the ASBL indicates the federal government may have diverted small business contracts to Bechtel and some of the largest corporations on earth. The Obama Administration is currently awarding small business contracts to firms such as Lockheed Martin, Raytheon, L-3 Communications, British Aerospace (BAE), Northrop Grumman, and Dell Computer. (www.asbl.com/documents/ASBL_2009_dataanalysis.pdf)  

To date, the ASBL has five outstanding lawsuits in the federal court system. (https://www.asbl.com/documentlibrary.html)  

“President Obama promised to have the most transparent administration in history, yet his administration continues to withhold even the simplest information on federal small business contracting programs. As I have said many times before, there is a big difference between what President Obama says and what President Obama does,” ASBL President Lloyd Chapman said. “Any time the Obama Administration withholds information that has always been released to the public, it shows us that we have found evidence of contracting fraud and abuse. I am confident that’s what we will find with this information.”

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Petaluma, Calif. – Despite national unemployment above 9 percent, and a continued jobless recovery, the Obama Administration has refused to make good on a campaign promise to end the diversion of billions of dollars a month in federal small business contracts to corporate giants.  As a result, the nation’s chief job creators, small businesses, are forced to compete head-to-head against Fortune 500 firms and other large businesses for even the smallest orders for goods and services.

Federal law requires the U.S. government to direct 23 percent of its purchases to small businesses.  Yet every year, a vast majority of federal small business contracts go to some of the biggest companies around the world.

According to the U.S. Census Bureau, small businesses create more than 90 percent of net new jobs, are responsible for 50 percent of the gross domestic product, 50.2 percent of the private sector workforce, and 90 percent of exports and innovations. Given the clear impact of small businesses on the nation’s economy, the American Small Business League (ASBL) maintains that it is unreasonable for the Obama Administration to continue ignoring this damaging widespread abuse. (http://www.sba.gov/advo/research/re359.pdf)  

Since 2003, a series of federal investigations have shown that an overwhelming majority of federal small business contracts actually go to Fortune 500 firms and even some of the largest corporations on earth. The most recent data released by the Obama Administration shows recipients of federal small business contracts including: Boeing, Lockheed Martin, Northrop Grumman, Raytheon, Dell Computer, Xerox, SAIC, General Dynamics, Bechtel and John Deere. (https://www.asbl.com/documents/05-15.pdf; www.asbl.com/documents/ASBL_2009_dataanalysis.pdf)

The ASBL maintains that the most effective way to supercharge job creation and stimulate the economy is to pass the Fairness and Transparency in Contracting Act.  If passed, the bill would end widespread abuse in small business programs and direct billions of dollars in existing federal spending to the nation’s 27 million small businesses.  The ASBL expects the bill to be reintroduced into the U.S. House of Representatives by Congressman Hank Johnson (D-GA) shortly.  (http://www.opencongress.org/bill/111-h2568/show )

“Passing the Fairness and Transparency in Contracting Act would create more jobs than anything proposed by the Obama Administration to date.  It’s simple, easy, deficit neutral and would provide the nation’s chief job creators with significantly increased access to federal contracting opportunities,” ASBL President Lloyd Chapman said. “It is time for President Obama to keep his promise and ‘end the diversion of federal small business contracts to corporate giants.’ ”

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